The insolvency of Signa Holding GmbH is starting to cause ripple effects across Rene Benko’s property and retail empire, with disruptions in Germany and Switzerland emerging.

A day after the group parent filed for a self-administered restructuring in Austria, a Swiss unit affiliated with the German Galeria store chain made a similar application in Zurich.

Retailer SportScheck also filed for insolvency in Germany on Thursday, halting a planned take-over by Frasers Group announced last month.

The filings show cash is running out fast at Signa’s retail units, which have been among the first to declare insolvency in the sprawling conglomerate that held property assets valued at €23 billion ($25 billion) at the end of 2022.

The suspended takeover of SportScheck shows how any deals to acquire Signa assets may face implementation risks, making potential suitors more wary of investing.

The sport retailer was in talks with several potential investors for a takeover, Chief Executive Officer Matthias Rucker told the Handelsblatt newspaper.

Austrian law doesn’t recognize group-wide insolvencies, meaning hundreds of Signa subsidiaries will need to individually decide whether to start similar proceedings, complicating the process.

The Galeria-parent Signa Retail Selection AG said it expected to be able to settle all external liabilities and to sell the assets in a well-organized and structured process over the coming months.

That has fueled speculation that the Galeria store chain, which went through a restructuring earlier this year causing German taxpayers about €590 million in losses, may soon change hands.

The restructuring administrator appointed to Signa Holding said he would present his first findings on a turnaround plan presented by the company at a creditor meeting on Dec. 19, according to the APA news service.

--With assistance from Libby Cherry.

(Recasts from first paragraph to add SportScheck insolvency, administrator comments)